Understanding Model a Challenge

More than five years after making one of the more startling oil discoveries of all time, Wolverine Gas and Oil Corp. is starting to nail down what kind of prospect it has.

That’s no exaggeration.

Wolverine shocked the industry by discovering the 100-million-barrel Covenant Field in central Utah’s hingeline area in December 2003.

AAPG member Keith Johnson, manager-geophysics for Wolverine in Grand Rapids, Mich., said the company and its new partner Oxy USA have acquired 100 miles of 3-D seismic over the original producing field and are completing initial processing.

“We feel like we have a pretty good idea of what the general structural framework is now,” Johnson said.

“The real key is going to be the 3-D seismic migration – prestack time and possibly prestack depth migration,” he noted.

Johnson confirmed that the company has made a second discovery on its 104-square-mile Federal Unit in Utah.

“We drilled two dry holes in the unit. One was the Twist Canyon 16-1 well in 2005 and the other was our Glenwood 10-1 well in 2006,” Johnson said.

“Then we stepped out to the north and made a discovery in what we call our Providence Field,” he said. “We have one well now that has tested oil and gas from two separate zones.”

The Covenant Field discovery well found a 487-foot Navajo Sandstone oil column at a measured depth of 5,846 feet in Sevier County, Utah. A classic and excellent reservoir sandstone, the Navajo in the area is 97 percent frosted quartz grains with an average 12 percent porosity, composed mainly of aeolian dune sets.

The Providence discovery well encountered an Upper Navajo sand at a measured depth of 8,853 feet and a second sand, probably also Navajo, at 12,121 feet, according to Johnson.

“We’re just in the process of drilling our first confirmation well” at Providence, he said.

A Lot of Challenges

When the company made its Covenant find, the public reaction was “There’s oil in central Utah!” while the industry reaction was more along the lines of, “There’s oil in central Utah?”

As Covenant and Providence prove, there’s oil and gas to be found. Today, the search for additional fields makes a challenging Easter egg hunt in one of the more complex play areas of the United States.

“I would say the biggest challenge is understanding the petroleum systems model, determining how the hydrocarbons migrated to that area and how they might be trapped,” Johnson said.

The overthrust belt relevant to the play begins in southern Nevada and curves through central Utah, western Wyoming and Montana and into Canada. Most of the oil and gas fields in the thrust have actually been discovered in Canada.

Johnson said the bedrock geology in central Utah was mapped by Clarence Dutton in 1870.

“This anticlinorium where the thrust structures go through was known from the surface geology, or was strongly suspected,” he noted.

Wolverine’s Federal Unit is about 37 miles long and three miles wide, Johnson said. Identified structures are expansive.

“Primarily, they’re on the order of four miles long and a couple of miles wide over this unit,” he said. “The structures are fairly large.”

That can be a challenge for seismic imaging, which has to stretch over the entire structural length.

“You have to shoot long lines,” Johnson said. “I use 10 miles as a minimum.”

The seal rock in the central Utah Navajo sand oil play is the Arapien Formation, which presents another seismic challenge.

“On top of the Twin Creek/Navajo Formation is the Arapien, a mixture of carbonates, evaporites and clastics. It’s all tectonically thickened and disharmonically folded – it’s a mess,” Johnson noted.

“It’s full of bright reflectors and it’s difficult to image through, primarily because of the steep dips,” he said.

Wolverine’s unit is almost all government land – about half federal, 34 percent state and 16 percent private. Wildlife protection restrictions and other regulations limit seismic acquisition to six months of the year, Johnson said.

“When we shoot seismic, we have to jump through all the hoops that everybody else has to when shooting on government lands,” he said.

Because of the rough topography of the play area, helicopter support has become a must, according to Johnson. Many shot holes are drilled by heliportable drilling rigs.

Wolverine now has acquired 3-D seismic on about a third of its Federal Unit, but it holds a sizable amount of 2-D data. The company purchased some of that data along with its leasehold.

Proof

Johnson said Chevron was looking to divest its Utah leases in 2000. At that time, central Utah was known more for its Cretaceous dinosaur eggs than its Jurassic reservoir possibilities.

Wolverine had been evaluating coalbed methane opportunities in the region.

AAPG member Doug Strickland, the company’s exploration manager, had worked as a Chevron geologist and was already familiar with the area from his university studies.

Wolverine acquired Chevron’s lease position in April 2000 and began mapping the thrust sheets to develop a prospect.

“We started out with a very meager seismic grid,” Johnson recalled.

When the Covenant oil find was first announced, some skeptics said the area was too barren of hydrocarbons to produce a future string of discoveries.

Johnson said just the opposite is true.

“Seismic interpretation was a little bit difficult because of the lack of well control out here. There were only two wells that penetrated the Navajo over our entire unit, and those wells were only about a mile apart,” he said.

Only 19 wells had reached the Navajo in the entire central Utah area, Johnson said.

The Covenant discovery was on the leading edge of the Sevier thrust belt, following a northeast-southwest hingeline that influences local stratigraphy.

It could be considered on-trend with other production along the thrustbelt, but the closest analog wells are a considerable distance away, Johnson noted.

“When we made the Covenant discovery, the nearest analog production was 146 miles to the northeast, in the Pineview Field,” he said.

Tectonic shifts, folding, faulting, two major orogenies and other events have made the central Utah hingeline area a geological crazyquilt. Picture a plate of scrambled eggs in a cubist painting by Picasso.

With the initial discovery, Wolverine had to answer the question: “Where did all this oil come from?” Geochemistry studies have fingerprinted the oil as organic carbon-rich, Mississippian-age crude from source rock in western Utah and eastern Nevada.

Johnson said the primary period of migration can be identified but “the problem is, most of the thrust structures are moving after that,” likely leading to re-migration.

“We spent almost two years putting together the petroleum systems model to prove to ourselves that there was hydrocarbon potential before we took it to the industry,” Johnson said.

Back to the Drawing Board

Based on that understanding, the company was convinced it had a legitimate natural gas play in central Utah. Wolverine put together the parcels to complete its Federal Unit and offered an exploration package proposal to the industry.

To overwhelming disinterest.

In 2002-03, the Wolverine Salina Prospect was shown at two North American Prospect Expos, and the Calgary Prospect Exchange, and was presented to 65 major and independent oil and gas companies. Wolverine finally managed to sell a 75 percent working interest at cost to 14 partners, including “business friends.”

One of the problems may have been the amount of drilling potentially required to develop information about the unit’s chances for production.

“It’s a large area and we knew it was going to take a lot of exploration out here,” Johnson said.

As it turned out, another possibility was discovering a significant amount of hydrocarbons-not natural gas but oil with associated gas – on the very first test well drilled on the first prospect structure.

In a way, that sent Wolverine back to the drawing board. It was a good example of the exploration truism that you think you know what you’re doing, then you find out a few facts about real-world conditions, and then you start to realize how much more you need to know.

With the potential for so many eggs in its basket, Wolverine brought in Occidental Petroleum subsidiary Oxy USA as a partner in the play.

It also began the task of developing a modified petroleum systems theory, to account for the oil and newly acquired geological information, and started accumulating 3-D seismic.

Now, more than five years after the Covenant discovery, the company is nearing completion of its first comprehensive, 3-D-based picture of the area.

With two producing fields already found and more than 100 square miles to explore, it’s bringing renewed interest to prospects for oil and gas in central Utah.